The Individual Coverage Health Reimbursement Account (ICHRA) is being touted as the latest way for employers to control the cost of health benefits, but what’s in it for employees?

In an ICHRA, employees choose their own health care coverage from a wide array of individual marketplace insurers and plans. Meanwhile, employers set aside a certain amount of money to reimburse employees for the premiums of the plans they select.

This method enables organizations to accurately predict how much they’ll spend on health benefits each year, freeing up money to invest in other ways, such as acquisitions, recruiting, salaries or other company improvements.

It’s certainly a boon for employers, but employees also have something to gain.

Employees have the freedom to choose the health plan that best suits them, their families and their wallets. They’re not tied to a one-size-fits-all plan provided by their employer because, with an ICHRA, their decision can be very specific to their personal needs.

For example, if an employee is healthy and rarely uses health insurance, they may purchase a lower cost plan with a higher deductible, potentially saving money by not having to pay for coverage they rarely use.

On the other hand, an employee who often accesses health care may benefit from purchasing a higher cost plan, a plan that will cost them less when they use it.

Aside from the freedom of choice that an ICHRA allows, employees may continue to benefit from the tax advantages that they have today, just like they do through a traditional group health insurance plan.

Finally, if an employee takes a job with another organization, they don’t have to lose the health plan they have already chosen. Their plan is portable. They can keep it through their transition period and even take it with them to another employer that offers benefits through an ICHRA.

We can help you determine if an ICHRA is right for your organization and employees. Contact Frank Spinelli at [email protected] or 330-662-0585 to get started.